Innovate (VATE) Q1 2026 Earnings Transcript

Motley Fool Transcribing, The Motley Fool Sat, May 16, 2026 at 12:26 AM GMT+7 13 min read Image source: The Motley Fool. Interim Chief Executive Officer — Paul Voigt SVP, Investor Relations — Anthony Rozmus Anthony Rozmus: Good afternoon. Thank you for being with us to review INNOVATE s first quarter 2026 earnings results. We are joined today by Paul Voigt, INNOVATE s Interim CEO, and Mike Sena, INNOVATE s CFO. We have posted our earnings release and our slide presentation on our website at innovatecorp.com. We will begin our call with prepared remarks to be followed by a Q&A session. This call is also being simulcast and will be archived on our website. During the call, management may make certain statements and assumptions, which are not historical facts, will be forward-looking and are being made pursuant to the safe harbor provisions of the Private Securities Litigation Reform Act of 1995. Any such forward-looking statements involve risks, assumptions and uncertainties, and are subject to certain assumptions and risk factors that could cause INNOVATE s actual results to differ materially from these forward-looking statements. The risk factors that could cause these differences are more fully disclosed in the cautionary statement that is included in our earnings release and the slide presentation and further detailed in our 10-K and other filings with the SEC. In addition, the forward-looking statements included in this conference call are only made as of this date of the call, and as stated in our SEC reports. INNOVATE disclaims any intent or obligation to update or revise these forward-looking statements, except as expressly required by law. Management will also refer to non-GAAP financial measures such as adjusted EBITDA. We believe that these measures provide useful supplemental data that, while not a substitute for GAAP measures, allow for greater transparency in the review of our financial and operational performance. At this point, it is my pleasure to turn things over to Paul Voigt. Paul Voigt: Good afternoon. We are pleased to report our first quarter 2026 financial results and we ll provide you with an update on our 3 operating segments. For the first quarter, INNOVATE delivered consolidated revenues of $364.8 million and adjusted EBITDA of $19.7 million. INNOVATE delivered a strong start to the year with solid execution across the portfolio and improving visibility into 2026. Infrastructure exited the quarter with strong momentum and a healthy backlog, while life science, advanced key regulatory and commercial milestones -- at Spectrum, we continue to make progress on strategic initiatives that position the business for improved performance ahead. To start the review of the subs at infrastructure, DBM Global achieved the first quarter revenue of $357.9 million and adjusted EBITDA of $23 million. During the quarter, DBM has seen gross margin compression year-over-year of approximately 140 basis points to 14.2% while adjusted EBITDA margin of 6.4% was largely consistent with the prior year quarter. Despite the year-over-year decrease in gross margin, we remain impressed by the world-class management team at DBMG, evidenced through maintaining our adjusted backlog of $1.8 billion from the end of the year of 2025 while increasing revenue as compared to the prior year quarter. DBMG started the year delivering a very strong first quarter, reflecting consistent execution and continued strength. Sales activity remained healthy with disciplined pursuit selection and strong conversion rates translating into meaningful backlog generation. DBM exited the quarter with clear momentum, underpinned by a robust improving pipeline and early success in building backlog for 2027. This progress reinforces our confidence in the durability of the revenue base and highlights the potential for incremental upside as project timing and scope continue to firm up. And importantly, as visibility extends further out, the focus of organization is evolving from near-term execution to a disciplined, capacity aligned growth ensuring we deploy resources thoughtfully while maintaining margins, operational flexibility and long-term value creation. Technology, health care and opportunities in New York City are driving our backlog to near record levels, and we have seen great results and positive outcomes as we ramp up these projects. We see a lot of capital is moving into physical infrastructure for computing in the United States. We are specifically seeing opportunities in technology-related construction markets and are concentrated around AI infrastructure, energy systems, advanced manufacturing and digital connectivity. Technology companies are expected to continue spending at historic levels on computing infrastructure, and we continue to see robust sales opportunities in the markets and DBM sees significant opportunities in the technology markets, specifically data centers, chipmakers and other specialty technology pr

Innovate (VATE) Q1 2026 Earnings Transcript

Key takeaways

Also covered by

Innovate (VATE) Q1 2026 Earnings Transcript

Key takeaways

Also covered by

More in business